S&P 500 sector analysis - year 2021

7 янв. 2022 г.

S&P 500 SECTOR ANALYSIS
The SPX index recorded a performance of + 26.89% (price return). The values ​​of the weights at 31/12/2021 and the trend of the different sectors in the last year are the following:
- Information Technology S5INFT: weight 29.2% - 2021 performance 33.35%
- Health Care S5HLTH: weight 13.3% - performance 2021 + 24.16%
- Consumer Discretionary S5COND: weight 12.5% ​​- performance 2021 + 23.66%
- Financials SPF: weight 10.7% - performance 2021 + 32.55%
- Communication Services S5TELS: 10.2% weight - 2021 performance + 20.53%
- Industrials S5INDU: weight 7.8% - performance 2021 + 19.40%
- Consumer Staples SP: S5CONS: weight 5.9% - performance 2021 + 15.55%
- Real Estate S5REAS: weight 2.8% - performance 2021 + 42.49%
- Energy SPN: weight 2.7% - performance 2021 + 47.74%
- Materials S5MATR: weight 2.6% - performance 2021 + 25.00%
- Utilities S5UTIL: weight 2.5% - performance 2021 + 13.99%
* (Weights rounded to the nearest decimal, as per the S&P methodology, the aggregate weights can be different from 100%)

Only 4 sectors performed higher than the index SPX(weight 45.40%) and the remaining 5 sectors (weight 54.80%) recorded lower performances.
In the graph there are two red bands, corresponding to periods in which SPX had a negative trend, in these periods only two S&P sector had an inversely correlated trend (SPN and SPF).

FOCUS 01/11/2021 – 19/12/2021

In this period, SPX index moved sideways, marking a -0.98% with the following sectors for which their performance must be highlighted:
- Negative performance: Energy SPN (-9.82%), Financials SPF (-6.49%), Communication Services S5TELS (-5.68%)
- Positive trend: Consumer Staples S5CONS (+ 4.54%), Real Estate S5REAS (+ 3.72%), Information Technology S5INFT (+ 3.17%)

FOCUS 20/12/2021 – today

In the last 3 weeks the performance of SPX has been positive with a return of + 3.36%. As can be seen from the graph, the performance of the various sectors was in line with the benchmark until 31/12/2021, but since the beginning of the year various sectors have moved differently between them and with respect to the market (negative trend from at the beginning of the year equal to -2.10%).
In particular, the sectors Energy SPN + 5.75% YTD (+ 15.41% for the period in focus) and Financials SPF + 2.89% YTD (+ 8.57% for the period in focus) they have had an opposite trend to the market since the beginning of the year. While the other sectors have moved more or less like the market, with Information Technology S5INFT -4.70% YTD (+ 1.41% for the period in focus) and Consumer Discretionary S5COND -3.61% YTD (+ 5.32% for the period in focus) which performed significantly lower than SPX since the beginning of the year.


PERFORMANCE ANALYSIS OF EACH SHARES OF S&P 500 INDEX IN 2021
Information Technology + 6.46% compared to SPX (weight 29.2%) S5INFT
Number of shares: 77
Share performance: 15.8% negative return vs 84.2% positive return
Equity yield comparison with SPX: 50% lower return vs 50% higher return
Comparison of share returns with sector index: 53.9% lower return vs 46.1% higher return
Notes: nothing unusual

Healt Care -2.73% compared to SPX (weight 13.3%) S5HLTH
Number of shares: 64
Share performance: 20.3% negative return vs 79.7% positive return
Equity yield comparison with SPX: 53.1% lower return vs 46.9% higher return
Comparison of share returns with sector index: 50% lower return vs 50% higher return
Notes: nothing unusual

Consumer Discretionary -3.23% vs SPX (weight 12.5%) S5COND
Number of shares: 61
Share performance: 13.1% negative returnvs 86.9% positive return
Equity yield comparison with SPX: 47.5% lower return vs 52.5% higher return
Comparison of share returns with sector index: 39.3% lower return vs 60.7% higher return
Notes: nothing unusual

Financials + 5.66% compared to SPX (weight 10.7%) SPF
Number of shares: 67
Share performance: 4.5% negative returnvs vs 95.5% positive return
Equity yield comparison with SPX: 26.9% lower return vs 73.1% higher return
Comparison of share returns with sector index: 43.3% lower return vs 56.7% higher return
Notes: About 3/4 of the shares in this sector outperformed the market, only 5% of the shares had negative returns

Communication Services -6.36% compared to SPX (weight 10.2%) S5TELS
Number of shares: 27
Share performance: 51.9% negative returnvs vs 48.1% positive return
Equity yield comparison with SPX: 81.5% lower return vs 18.5% higher return
Comparison of share returns with sector index: 66.7% lower return vs 33.3% higher return
Notes: sector in which half of the shares had negative returns, in addition 2/3 of the shares had lower returns than their sector

Industrials -7.49% compared to SPX (weight 7.8%) S5INDU
Number of shares: 72
Share performance: 12.5% ​negative return vs 87.5% positive return
Equity yield comparison with SPX: 55.6% lower return vs 44.4% higher return
Comparison of returns on shares with sector index: 43.1% lower return vs 56.9% higher return
Notes: sector with return below the S&P 500, but nearly 90% of the shares had positive returns

Consumer Staples -11.34% vs SPX (weight 5.9%) S5CONS
Number of shares: 32
Share performance: 18.8% negative return vs 81.3% positive return
Equity yield comparison with SPX: 78.1% lower return vs 21.9% higher return
Comparison of share returns with sector index: 62.5% lower return vs 37.5% higher return
Notes: about 80% of the shares had positive returns but lower than the S&P 500 index

Real Estate + 15.60% compared to SPX (weight 2.8%) S5REAS
Number of shares: 29
Share performance: 0% negative return vs 100% positive return
Equity yield comparison with SPX: 34.5% lower return vs 65.5% higher return
Comparison of share returns with sector index: 48.3% lower return vs 51.7% higher return
Notes: All stocks had positive returns

Energy + 20.85% compared to SPX (weight 2.7%) SPN
Number of shares: 21
Share performance: 0% negative return vs 100% positive return
Equity yield comparison with SPX: 19.0% lower return vs 81.0% higher return
Comparison of share returns with sector index: 47.6% lower return vs 52.4% higher return
Notes: All stocks had positive returns

Materials -1.89% compared to SPX (weight 2.6%) S5MATR
Number of shares: 28
Share performance: 7.1% negative return vs 92.9% positive return
Equity yield comparison with SPX: 50% lower return vs 50% higher return
Comparison of share returns with sector index: 50% lower return vs 50% higher return
Notes: Over 90% of the shares had positive returns

Utilities -12.90% compared to SPX (weight 2.5%) S5UTIL
Number of shares: 28
Share performance: 3.6% negative return vs 96.4% positive return
Equity yield comparison with SPX: 89.3% lower return vs 10.7% higher return
Comparison of share returns with sector index: 50% lower return vs 50% higher return
Notes: This is the lowest performing sector compared to the S&P 500, however only 1 stock had negative returns


RELATIVE ROTATION GRAPH (weekly data)
- LEADING: Materials, Real Estate, Information Technology, Consumer Discretionary (high probability to move to WEAKENING)
- WEAKENING: Energy
- LAGGING: Financials, Communication Services
- IMPROVING: Industrials , Utilities, Health Care, Consumer Staples

RELATIVE ROTATION GRAPH (daily data)
- LEADING: Materials
- WEAKENING: Health Care, Consumer Staples, Utilities, Real Estate, Information Technology (high probability to move to LAGGING)
- LAGGING:
- IMPROVING: Financial, Industrials , Consumer Discretionary, Energy (it's probable to move to LEADING), Communication Services (probable return to LAGGING)


Dr. Cunti Mattia, CFTe®, EFA


** WARNING **
The content of the analysis just carried out is the result of personal opinions and does not constitute a solicitation to buy or sell any financial instrument.
These views therefore do not constitute advice or a recommendation to invest or disinvest.
The analyzes are for informational purposes only, and do not constitute personalized advice, as the writer does not know the personal characteristics of any of the readers, especially income flows, ability to bear losses, equity consistency.